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Yang, S and Wei, L (2010)

Detecting money laundering using filtering techniques: a multiple‐criteria index

Journal of Economic Policy Reform 13(2), pp. 159-178.

ISSN/ISBN: Not available at this time. DOI: 10.1080/17487871003700796


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Abstract: Money laundering is a dynamic activity attempting to circumvent anti-money laundering (AML) actions. We propose a money-laundering detection approach encompassing three separate detection measures applied simultaneously, providing a consolidated index to minimize circumvention. The index incorporates three detection measures: (1) deviations in trading volume and frequency; (2) unusual payments to or receipts from an atypical trade partner; and (3) Benford’s Law, based on the number of times a specific digit occurs in a particular position in numbers to detect financial fraud. Finally, we design a numerical test that any reasonable detection approach should satisfy. Our results successfully discover possible fraud planted in the simulated data.


Bibtex:
@article{, author = { Shenggang Yang and Lai Wei }, title = {Detecting money laundering using filtering techniques: a multiple-criteria index}, journal = {Journal of Economic Policy Reform}, volume = {13}, number = {2}, pages = {159--178}, year = {2010}, publisher = {Routledge}, doi = {10.1080/17487871003700796}, URL = { https://doi.org/10.1080/17487871003700796 },


Reference Type: Journal Article

Subject Area(s): Accounting, Economics